Sustainable finance disclosure in the EU financial sector

The aim of the chapter is twofold. On the one hand, it explores the main features of theSustainable Finance Disclosure Regulation. On the other hand, it tries to assesswhether the Sustainable Finance Disclosure Regulation is likely to succeed inharmonising sustainability-related (i) disclosure rules and (ii) fiduciary duties, not onlyacross Member States, but also across financial products and distribution channels. Theauthor concludes that before we reach a sufficient degree of harmonisation ofsustainability-related disclosure rules and fiduciary duties there is still a long way togo. And even if we reach the required degree of harmonisation in the EU, it is not agiven that this will necessarily lead to a more sustainable world. As may be gleanedfrom the European Green Deal and the Sustainable Finance Action Plan, the EU isaiming high when it comes to sustainability. But the EU is not an island. The authorargues that there are roughly two opposite scenarios. In a pessimistic scenario, themore lenient or even non-existent sustainability agenda of other geopolitical powersgives them a competitive edge that is detrimental to the EU. In a positive scenario, theEU becomes a global standard-setter in the area of sustainability. Large globalinstitutional investors such as Blackrock and State Street in any event say they arestrong supporters of the sustainability agenda. Also, the re-entry of the USA in the ParisClimate Agreement under the Biden Administration may give us some hope